Equities have started the year on the front foot. World stockmarkets have notched modest gains, with a number of US tech giants already posting double digit returns for the year. Leading the way is artificial intelligence champion Nvidia, which is up well over 50%. Bond investors have been less lucky. So far this year, core US inflation has run at a 4%+ annualised rate, defying expectations that price increases will smoothly slow. That stubborn inflation has pushed up expectations for interest rates, with the 2-year Treasury yield rising to 5%. As bond yields have risen, their prices have fallen.
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